Istat: Italy needs a strong push on 'human capital', valuing young people and immigrants

It is therefore necessary not only to increase the resources allocated to education, particularly university education, but also to ensure that technological progress becomes a factor of inclusion for all. The capacity to produce and enhance human capital, in addition to depending on the supply of educational activities, requires an adequate level of social capital, a set of fiduciary relations, shared norms and cooperation networks that foster social cohesion and equity of opportunity, as well as openness to the future and innovation.

The numbers speak for themselves: in our country, the population continues to be affected by transformations that do not only concern numerical consistency (58.9 million individuals as at 1 January 2026), but also composition and structure, affecting socioeconomic balances. In 2025 the population did not change compared to the previous year, but the natural balance remained negative (-296 thousand units) and was offset by a positive migration dynamic of a similar magnitude. In this context, the decline in births (355 thousand units; -3.9% on 2024) is fuelled by the lower propensity to have children (from 1.18 to 1.14), but also by the lower number of generations of reproductive age. The trend to postpone parenting is confirmed (in 2025 the average age at childbirth is 32.7 years).

Among the key figures, one of the most important concerns employment: 2025 confirmed the expansion trajectory of the labour market, driven above all by the more mature segments of the population (50 and more - 42%); the gap with Europe is narrowing, but the employment rate (in 2025, 62.5%) still places our country at the tail end of the EU27. The unemployment rate is also falling to the European average level (6.1%). Standard forms of employment are increasing (15.7 million individuals, up by 2.3 million compared to 2019, almost two-thirds of total employment) and the vulnerable are falling, which after the post-pandemic increase of 2021-2022, have shrunk by almost a million, (more than 4 million in 2025, 17.0% of total employment; 22.3% in 2019), characterised by temporary contracts, involuntary part-time and low pay levels. The share of NEET young people aged 15-19 not in employment and no longer in education or training is increasing. In 2025 they are 13.3 per cent against 25.7 per cent in 2015. In short, we are on the right track, but we will have to do even better in the future. If labour market participation were to remain fixed at 2025 levels, by 2050, due to the expected decrease in the population aged 15-64 alone, the active population would drop by more than five million individuals (from 24.8 million in 2025 to 19.7 million).

In order to counter the macroeconomic consequences of a decline in economic activity," notes ISTAT's annual report, "it will therefore be necessary to significantly increase activity rates, starting with those of young people and women, bridging the wide and persistent territorial and educational gaps. And let us remember that what fuels the gender gaps is the persistent asymmetry in family burdens: despite a slow process of convergence, women continue to bear the largest share of domestic and care work, even in couples in which both work (women perform 68.9 per cent of all family work, down from 75.4 per cent in 2003). To return to the topic of education, one figure is eloquent: between 2007 and 2025, the number of employed people estimated by the ISTAT labour force survey increased by almost 1.3 million, from 22.8 to 24.1 million, an increase of 5.6 per cent. Over the same period, those employed with a tertiary qualification - i.e. a university degree - increased by about 70 per cent. Between 2011 and 2025, on the other hand, those employed as specialists and technicians increased by about +15.0 per cent. These are substantial changes, despite the fact that Italia lags behind the major European economies in terms of the number of graduates and qualified personnel

The trend of the main productivity indicators does not yet show the necessary change of pace to strengthen the growth prospects of the Italian economy. In the 2015-2025 decade, against an average annual change in value added of 1.5 per cent, the contribution of the factors of production, labour and capital, amounted to about 0.9 and 0.1 percentage points, respectively, while total factor productivity (TFP), a measure of the contribution to growth offered by technology and knowledge, contributed 0.6 percentage points. The dynamics of the latter component is the result of two opposing phases: a significant increase in the pre-pandemic five-year period (+0.9 points) and a phase of substantial stagnation between 2021 and 2025 (-0.2 points).

One of the most interesting data in the report is the comparison with Spain, which in recent years has recorded growth on average higher than that of the main euro area countries, including Italia. Between 2022 and 2025, in the phase following the recovery to pre-pandemic levels, Spanish GDP recorded a cumulative growth of 9.0 per cent, compared to 2.3 per cent in Italia. This result is not exclusively attributable to cyclical episodes, but also reflects a greater capacity of the Spanish economy to generate more sustained growth in domestic demand and productive activity, including through productivity gains and a greater orientation towards more advanced technology sectors, especially in services. In Spain, growth in 2025 compared to 2022 was jointly driven by consumption and exports (+6.8 and +3.6 percentage points), while in Italia the contributions of the same components were, on average, significantly lower (+2.2 and +0.2 percentage points). On the consumption side, the determinants of Spain's better performance are multiple and include not only stronger growth in household consumption, but also a greater impulse from public spending. In Spain, in fact, the cumulative increase in government expenditure was 10.2 per cent, compared to 3.1 per cent in Italia, also reflecting less stringent budgetary constraints. The greater dynamism of household consumption in Spain compared to Italy is attributable to both demographic factors and sustained growth in real incomes. In fact, the increase in Spain's population between the ages of 15 and 64 (+4.6 per cent between 2022 and 2025) was higher than Italy's (+1.6 per cent), driven by the strong expansion of the component of regular foreigners (+22.3 per cent; in the same period, +4.6 per cent in Italia). This component broadened the productive base and fuelled domestic demand, generating a cumulative effect between labour supply and consumption. In Spain, real incomes increase significantly over the 2022-2025 period (+14.8 per cent), while in Italia their growth appears weaker and more irregular (+3.3 per cent over the same period).